Can B.C. really stop the Trans Mountain pipeline, and how can the feds make sure it is built?

'If B.C. wanted to get really bloody-minded about it, it could play constitutional whack-a-mole,' says an expert in energy and constitutional law

OTTAWA — An extraordinary provincial trade war is kicking off in Western Canada, as B.C. threatens to block Kinder Morgan’s Trans Mountain pipeline expansion through the use of environmental regulations. Alberta has already responded by ditching talks about importing B.C. electricity and cutting off B.C. wine imports.

But the fight really boils down to the B.C. government versus the federal government, as interprovincial pipelines are the jurisdiction of the National Energy Board. The Trudeau government and the energy board have already approved the Trans Mountain expansion, subject to 157 conditions.

Prime Minister Justin Trudeau has said the pipeline expansion from Edmonton to Burnaby will be built — and repeated that at a protest-filled town hall event in Nanaimo, B.C., on Friday. But Alberta Premier Rachel Notley is demanding Trudeau do more to fight B.C.’s threat to block the project through regulatory hurdles.

What legal steps could Trudeau take to ensure the pipeline goes ahead? He does have some heavy constitutional weapons to deploy, but there are other events that are more likely to happen first.

If B.C. does bring in a regulation to restrict the flow of diluted bitumen while studies are done on spill mitigation (for now, the province only says it intends to consult on such a regulation), it’s very likely it would ultimately be deemed unconstitutional.

“A province cannot impair a federally regulated undertaking,” said Robin Junger, the former head of B.C.’s environmental assessment office and a former B.C. deputy minister of energy. He now works in private practice at McMillan LLP. “Can they put certain conditions on it? Yes. But if the effect is to stop it, it won’t work.”

In the meantime, Kinder Morgan could simply proceed with construction and dare B.C. to take them to court, Junger said. But it’s much more likely the company would seek a declaration from the energy board that the provincial regulations violate federal jurisdiction and are thus inoperative.

The company has already done something like this, when the City of Burnaby attempted to use municipal bylaws to withhold permits for preparatory work on the pipeline expansion.

“The company went to the National Energy Board and said … the statute gives you the power to answer constitutional questions,” Junger said. “The NEB gave them that ruling.”

Ian Blue, a lawyer with Gardiner Roberts and an expert in energy and constitutional law, said Kinder Morgan may indeed be able to manage this on its own through an order from the energy board. But he said the federal government has options for intervening if B.C. moves forward with the regulations.

“It could instruct the Attorney General of Canada to commence action in B.C. Supreme Court for a declaration that the proposed regulations are unconstitutional,” he said. “That in itself would be a huge shot across Premier Horgan’s bow.”

A protest in Vancouver against Kinder Morgan’s Trans Mountain pipeline.Darryl Dyck/The Canadian Press/File

And there is another federal power that could be called upon, though it hasn’t been exercised in nearly a century.

“Once the regulations came into force, the Liberal government could just cut through all this delay and legal process, and under section 90 of the Constitution Act, disallow the regulations,” he said. “It has not been used since the 1940s, but it’s still a very definite power in the Constitution Act and could be used.”

But even if B.C. has little chance of prevailing legally in the long run, in the short term it could still cause so much delay and general uncertainty that Kinder Morgan eventually decides the project isn’t worth it.

“If B.C. wanted to get really bloody-minded about it, it could play constitutional whack-a-mole,” Blue said. “While the Attorney General of Canada and Kinder Morgan are in court arguing over one provision, they could then pass another provision, and the whole process would have to start all over again.”

That’s why a political solution may be necessary now, before any legal process gets underway. (Though there is already a Federal Court of Appeal case being heard on whether First Nations were duly consulted, and the B.C. government has intervenor status.)

Junger said there’s a “poker game” going on between B.C. and Alberta, which is why Notley is calling for federal intervention despite the fact no regulations have been set yet.

“I think the government of Alberta must know that legally it’s premature, but they’re worried that the net effect (of B.C.’s threat) will be to just scare the proponent away,” he said.

Meanwhile, construction on the Trans Mountain pipeline was planned to begin this month, but has now been delayed while the company works through the latest obstacles.

“Currently Trans Mountain is focusing on route hearings and advancing the permitting process,” it said in a statement. “Until we receive greater clarity and certainty on permitting, approvals and judicial reviews, Trans Mountain will not be moving towards broader construction activities.”

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